5 groups that really do need life insurance

Stay-at-home parents
Stay-at-home parents © Iofoto/

In a world of stagnating incomes, two-earner families have become more the rule than the exception. But there are still cases in which one parent works while the other looks after the children.

Couples in this situation often purchase a life insurance policy based on the working spouse's income, but forget to account for the stay-at-home parent's value.

"I used to tell my husband while our kids were growing up, 'If I died tomorrow, you would have to hire 10 people to do what I do,'" Boglioli says.

Life insurance could help pay for the services the stay-at-home parent currently provides, Rothschild says.

"Consider what it would cost to fund child care, transportation, cooking, cleaning or any other household activity," he says.

But it's unusual to see couples purchase life insurance to cover the stay-at-home parent's contribution, Komer says.

"You see insurance coverage on just the breadwinner," she says. "Very few times do you see stay-at-home moms get coverage."

Madgett says that can be a mistake. He cites an estimate that the average salary of a full-time nanny is $36,400.

To cover that amount " you would need a life insurance policy with approximately $910,000 in death benefit," he says.


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